The average price paid by a first-time buyer in England could rise by almost £24,000 by 2030 if official house price forecasts prove accurate, analysis from Coventry Building Society suggests.

Using Office for Budget Responsibility forecasts of annual house price growth of more than 2%, the mutual estimates that the average first-time buyer property could increase in value from £245,515 today to about £269,377 by the end of the decade.

That would represent an increase of £23,862, creating a higher savings target for prospective homeowners who are several years away from buying.

For somebody planning to put down a 10% deposit, Coventry calculates that the increase would require an additional £2,386 upfront. Saving that amount between now and 2030 would mean putting aside approximately £56 extra each month.

REGIONAL DIFFERENCES

The potential increase varies considerably by location. County Durham, the most affordable county included in the analysis, has an average first-time buyer property price of £132,748. Coventry projects this could reach £145,650 by 2030, requiring about £30 a month in additional savings to maintain a 10% deposit.

At the other end of the table, the average first-time buyer property in Surrey is projected to increase from £382,334 to £419,494. A 10% deposit would rise to £41,949, with buyers needing to save an additional £88 a month to keep pace with the projected increase.

Greater London was excluded from Coventry’s county rankings, but its figures point to an even larger savings requirement. The average first-time buyer property in the capital is projected to rise from £496,302 to £544,539, requiring an additional £114 a month to maintain a 10% deposit.

Higher prices could also leave more first-time buyers exposed to stamp duty. Coventry said properties in some areas could move above the current £300,000 threshold for first-time buyer relief as values increase.

SAVINGS TARGETS

The analysis comes after the government announced Your First Home, an equity loan scheme expected to enable eligible buyers in England to purchase participating new-build properties with deposits of 2.5%, supported by a 20% government-backed equity loan. Further details, including income and property price caps, costs and the timetable, are due to be confirmed at the Budget.

Jonathan Stinton, head of intermediary relationships at Coventry Building Society, said: “For first-time buyers, the deposit challenge is a moving target. People are not just saving for the price of a home today, they are trying to keep pace with where prices could be by the time they are ready to buy.

“Even modest annual increases can add up over several years, meaning buyers may find their goal has shifted significantly.

“Starting to save early can make a real difference. These projections aren’t about putting people off buying a home but highlighting the importance of planning ahead and understanding how much you may need by the time you’re ready to take that step.

“Buying a first home remains a major milestone for many people and understanding how your target could change over time is an important part of preparing for that journey.”